Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Pound Pares Some Gains as Analysts Warn of Low Rate Hurdle

Forex Nov 23, 2020 03:03PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Yasin Ebrahim

Investing.com – The pound gave up some gains against the dollar after hitting a 10-week high as analysts suggest the low U.K. rates will keep a lid on sterling's path higher even as Brexit deal looks likely.

GBP/USD rose 0.2%  to $1.3312 after hitting a high of $1.3398 intraday.

"GBP gets a Brexit boost to $1.36, but then weakens as UK real yields are low," Morgan Stanley (NYSE:MS) said in a note.  

The optimism over a Brexit deal comes as the European Commission reportedly told EU ambassadors on Friday that 95% of a post-Brexit deal had been agreed.

"Recent days brought media reports of optimism that a deal might be announced over coming days, which would allow sufficient time for ratification by the European Parliament before year-end – albeit perhaps just the week after Christmas," Commerzbank (DE:CBKG) said in a note.

The wave of positive reports has raised expectations that a deal could be reached in the coming days, though given the range of politically sensitive issues that remain outstanding, a final agreement will likely need to be "brokered personally between [European Commission President] Von Der Leyen and UK Prime Minster Johnson," the bank added.

Bank of England governor Andrew Bailey warned on Monday that a no-deal Brexit would be worse for the economy than the long-term impact of the coronavirus epidemic.

“It is in the best interests of both sides… for there to be a trade agreement and for that trade agreement to have a strong element of goodwill around it in terms of how it is implemented,” Bailey told the Treasury committee.

PM Johnson confirmed that the England lockdown would be lifted on Dec. 2, though regional restrictions would be kept in place to stop the spread of Covid-19.

The second lockdown dealt a blow to business activity, with some warning the U.K. economy is set to slip into a double-dip recession.

"A double-dip is indicated by the November survey data, with lockdown measures once again causing business activity to collapse across large swathes of the economy," said Chris Williamson, chief business economist at IHS Markit.

Pound Pares Some Gains as Analysts Warn of Low Rate Hurdle
 

Related Articles

Dollar Up over Renewed Recession Fears
Dollar Up over Renewed Recession Fears By Investing.com - Jul 06, 2022 1

By Zhang Mengying Investing.com – The dollar was up on Wednesday morning in Asia as renewed recession fears sent investors to safe-haven currencies. The U.S. Dollar Index that...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email